Rox Resources (ASX: RXL) is on track to become a significant gold producer with its Youanmi Gold Project, backed by a robust Definitive Feasibility Study and full funding. The project targets 117kozpa initially, with ambitions to surpass 150kozpa through ongoing exploration and development.
- Youanmi DFS supports 674koz high-grade ore reserve
- Project fully funded with A$218m equity and A$350m debt
- Initial production target of 117kozpa over 7 years
- Low AISC of A$1,978/oz underpinning strong margins
- Exploration underway to extend mine life and scale output
Robust DFS Underpins Youanmi’s Production Pathway
Rox Resources (ASX:RXL) has solidified its position as a rising gold producer with a Definitive Feasibility Study (DFS) that underwrites a high-grade ore reserve of 4.4 million tonnes at 4.8 grams per tonne gold, equating to 674,000 ounces. The broader Mineral Resource Estimate (MRE) stands at 12.1 million tonnes at 5.6 g/t for 2.2 million ounces, providing a substantial base for future growth.
The DFS outlines a mine plan targeting 900,000 tonnes per annum throughput, producing approximately 117,000 ounces of gold annually over an initial seven-year life of mine. This base case is supported by a low all-in sustaining cost (AISC) of A$1,978 per ounce, positioning Youanmi as a low-cost, high-margin operation with estimated free cash flows of around A$2.3 billion pre-tax at a gold price of A$5,200 per ounce.
Fully Funded Project with Strong Financial Metrics
Rox has completed a A$218 million equity raise and secured A$350 million in debt facilities from tier-one banks, ensuring the project is fully funded through to production. Pre-production capital expenditure is forecast at A$383 million, covering processing facilities, underground mining, and site infrastructure.
Financial metrics are compelling, with a pre-tax net present value (NPV8) of A$1.4 billion and an internal rate of return (IRR) of 69% at the DFS gold price assumption. At a spot gold price of A$6,100 per ounce, the NPV8 rises to A$1.9 billion with an IRR of 93%, highlighting the project’s sensitivity to gold price upside.
Construction and Development Progressing On Schedule
Construction is advancing on time and within budget, with mill construction underway and underground mining permits secured. Ore development is active on multiple fronts, building high-grade stockpiles of 190,000 tonnes at approximately 3.3 g/t gold ahead of commissioning. This stockpiling strategy is designed to significantly de-risk the ramp-up phase.
Key project milestones such as final investment decision (FID) approval in March 2026, execution of a fixed-cost EPC contract, and commencement of dewatering works reflect a disciplined and execution-focused approach. First gold production is scheduled for mid-2027, with ramp-up expected from late 2027.
Exploration and Growth Potential Beyond Base Case
Rox is actively pursuing growth beyond the DFS mine plan with an aspiration to increase production above 150,000 ounces per annum. Underground drilling programs are underway, including a 35,000-metre step-up drill campaign targeting resource conversion and extension at United North and other high-priority targets.
Surface infill drilling has already identified significant mineralisation outside the base mine plan, and regional exploration along the 60-kilometre Youanmi Shear Zone remains underexplored. Upcoming programs include reconnaissance mapping, co-funded drilling under the Exploration Incentive Scheme, and a Mineral Resource update for the Commonwealth prospect.
This exploration pipeline offers a pathway to increase production rates and extend mine life, leveraging the mill’s nameplate capacity of 1 million tonnes per annum versus the initial 900,000 tonnes per annum mine plan.
Experienced Management and Clear Vision
The project is led by a seasoned team with a proven track record in developing Australian gold mines. Key executives including Managing Director Phillip Wilding and General Manager of Studies Daniel Marchesi bring deep operational and technical expertise, supported by a board focused on delivering sustainable value for shareholders and communities.
Rox’s disciplined capital structure features 1.39 billion shares on issue, a market capitalisation of A$528 million, and a cash balance of A$152.7 million as of June 2026, providing a solid financial platform as Youanmi moves from development into production.
Bottom Line?
Youanmi’s strong DFS and full funding set the stage for Rox to deliver low-cost gold production, but the company’s growth ambitions hinge on exploration success and operational execution over the coming years.
Questions in the middle?
- Will ongoing drilling convert enough resources to increase production beyond 150kozpa?
- How will gold price fluctuations impact Youanmi’s project economics and cash flow?
- What operational challenges might arise during ramp-up and early production phases?